December 2019

✓ Experienced management team that

has successfully built loan books

✓ Well-positioned to progress to full

banking licence

✓ Centralised technology with no legacy

systems

THE INVESTMENT

PROPOSITION

Unique opportunity to invest in a new

listed UK-based SME bank focused on

service excellence, speed of execution,

flexible structuring and durable customer relationships.

CITY OF LONDON GROUP PLC

03

CAML provides debt

and asset finance to

SMEs

Established in 2011

Works through broker

channels

Loan book approx. £16m

Focus on equipment

finance, professional and

commercial loans

Established in 2018 to provide

financial services to the

UK SME sector

Targets an underserved but

growing business customer

population

Customer proposition

will be centred on business

understanding, responsiveness,

expertise, accessibility,

flexibility and fairness. Enabled

by a market leading IT platform.

Banking licence application

submitted

P&FS offers property and

bridging loans for acquisitions,

refinancing, refurbishments

and development

Established in 2018

Loan terms are

structured to fit individual

business plans, bespoke

to the customer

Has already sanctioned

£14m in deals

City of London Group is the parent company of a number of businesses focused on

serving two key segments, the UK SME market and home reversion

CITY OF LONDON GROUP PLC

04

Owns a portfolio of home

reversion plans with NAV of

£17.8m

Residential property investments of

approx. £71m and a vacant possession

value of £96m

Established in 2004, the business has

established 570 plans, secured on 510

properties

Is a liquidating asset generating c

£2m of cash per annum

Established in 2008 as an

independent intermediary

Whole of market broker for

insurance, mortgages, pensions,

commercial loans and investments

Serving Private Clients and SMEs

with strong emphasis in the

Property Sector

Arranged over £150m of commercial

debt

MARKET DYNAMICS- SME BANK OPPORTUNITY

05

5.7m SMEs

in the UK

SME new lending

market approx.

£5.5bn per quarter

Strong political and regulator

support for more new

entrants (CMA5 currently

hold 90% of market share)

We require circa 4,500 borrowers or 0.1% market

share to achieve our 5 year target

PRA Business Plan 2018/19

– in the next 3 years expect

around 20-30 new banks

(Source: Mintel survey for Recognise Financial Services Ltd 2018)

SME NEW* ENTRANTS HAVE DEMONSTRATED

EARLY PROFITABLE GROWTH

06

NAME RESULTSLENDING TO CUSTOMERS

(£M)

DEPOSITS TO CUSTOMERS (£M)

PROFIT BEFORE TAX

(£M)

NET MARGIN

COST/ INCOME RATIO

CET1 RATIO COMMENTSRETURN ON

EQUITY

LOAN TO DEPOSIT

RATIO

2024 1,100 1,300 25-35 4.0-4.5 35%-40% 18%Application submitted. These

are 5 year targets.19-20% 84%

Jun 18’8,991(+20%)

7,776 (+16%)

195 (+52%)

3.5% 46% 12.3%Acquired by FirstRand and delisted from LSE

in Mar/1813.9% 116%

Dec 18’ 5,845.9 (+21%)4,977.9 (+3%)

110 (+27%)

5.1% 51% 12.3%The Group is now 100% owned

by BC Partners and Pollen Street Capital

16.1% 117%

Dec 18’769

(+11%)901

(13%)28

(+14%)4.6% 34% 16.8%

Additional capital of £31m injected by existing S/H

22.3% 85%

Dec 17’632

(+36%)596

(+14%)10

(+125%)5.1% 58% 21%

Launch of Specialist Business finance with senior hires

9.3% 106%

Dec 18’ 1,297 (+113%)1,185

(+139%)34

(+220%)6.3% 37% 26%

£100m of Reg Capital raised in 2018

19.0% 109%

Sep 18’ 186.26 (+222%) 191.14 (+260%)7

(-22%)7.7% 32% 20.8%

Acquisition of Azule Ltd lead to increase in £16.5 million loan

book19.9% 96%

*opened post 2010

✓ Recruitment of

Chair/NEDs▪ PRA

Challenge

Feedback

▪ ICAAP/ILAAP

Challenge

WHERE ARE WE NOW?

Q1

2018

Q2

2018

Q3

2018

Q4

2018Q1

2019

Q2

2019Q3

2019

Q4

2019

Q1

2020

Q2

2020

Q3

2020

Q4

2020

Our journey so far… Next Steps

7

✓ Journey begins

and terms agreed

✓ Introductory

meeting with

regulator

✓ CRO/FD/CCO

recruitment

✓ 1st

Regulator

Challenge

✓ 1st Regulator

Challenge CTO

Recruitment

✓ 2nd RBP

Submission

✓ 2nd

Regulator

Challenge

✓ Completion

of £15.2m

fundraise

▪ Invitation to

apply

▪ Application

submitted

▪ Deposit

platform build /

implementation

▪ Recruit key

roles (20 FTE)

▪ IT/Build/

Implement

▪ Intended institutional

fundraise

▪ Deposit platform build

/ implementation

▪ Full

licence

▪ Testing

▪ Mobilisation

▪ £50k deposit taking

▪ Rollout product suite

▪ Meet regulatory

requirements

▪ PRA Capital/Liquidity

requirements

(additional £10m)

▪ Testing

▪ Mobilisation

WHY WILL RECOGNISE BE SUCCESSFUL?

08

Retail and

business

savings

Relevant

lending

products

Management

experience

Speed of response,

pace of execution,

flexible structures

Passionate about

relationships, continuity

of management and

access to decision

makers

Breadth of delivery channels

and existing professional

/customer networks

Customer focus,

commitment to innovate

and exceed expectations

Versatile

Cloud-based

IT platform

Robust risk

culture and

framework

Strategy

founded

on long term

viability

Experience drawn

from COLG existing

businesses and

shareholder

commitment

200+ YEARS’

EXPERIENCE

BLACK BOOK

ABILITY TO TEST

PRODUCTS

PRIVATE BANK

FOR SMES

BEST-IN CLASS

TECHNOLOGY

RECOGNISE and COLG EXECUTIVES –

A TEAM WITH DEEP EXPERIENCE

09

BRYCE GLOVER

Deputy Chief Executive Officer

36 years’ experience

Formerly MD of Commercial Banking at

Alliance & Leicester/Santander;

Commercial Director at Nationwide BS

responsible for a £22bn lending portfolio.

NED and Chair of Group Risk Committee

at Newcastle Building Society.

COLIN WAGMAN

Chairman, COLG

54 years’ experience

Deputy Chairman of Delancey,

NED of Alpha Plus Holdings Plc

and NED of Minerva Ltd

PHIL JENKS

Chairman, Recognise

40 years’ experience

Deputy chairman of CCFS.

37 years at Halifax Bank of

Scotland and NED of Leeds

Building Society

JASON OAKLEY

Chief Executive Officer

33 years’ experience

Formerly MD of Commercial Banking &

Mortgages at Metro Bank building the

business to c£2.5bn within 3 years.

Head of SME at NatWest & RBS with

over 3000 relationship Managers

covering 1m customers.

MICHAEL GOLDSTEIN

Chief Executive Officer, COLG

36 years’ experience

Previously Senior Audit partner at

BDO responsible for the management

of their national audit business. Led

the restructuring of a large family

property business

DAVID JENKINS

Chief Financial Officer

20 years’ experience

Former Director of FP&A and

Capital Management at Aldermore.

Previous leadership roles at

Prudential, Lloyds and ABN AMRO

Starts early 2020

10

PRODUCT PROPOSITION

LOANS

USE: Commercial Property/Working

Capital/Professional Buy-to-Let/Refurbishment/Asset

Finance/Bridging Finance/General Purposes

SIZE: up to £5m

TERM: 3 months to 5 years

DEPOSITS

CUSTOMER: Retail and SME through established

outsourced service provider

SIZE: min. £1k (FSCS protected)

TERM: up to 5 years

LENDING

Commercial Property Loans

26%

Professional Buy to Let

18%

Bridging Loans6%

Refurbishment Loans3%

SME Commercial

Loans32%

Working Capital Loans

7%

Professional Practice Loans

4%

Asset Finance4%

*figures are estimates and areas where Recognise will lend is subject to change.

ROUTES TO MARKET

11

ROUTES TO MARKET

BROKERS - 60% CHANNEL

DISTRIBUTION IN Y1

REDUCING TO 30% BY Y4

DIRECT GROWING CONTRIBUTION

OF INTERNALLY DRIVEN

BUSINESS DEVELOPMENT

Time

DELIVERY CHANNELS

DirectRegional Business

Development

Managers

Commercial

Brokers

Trade

Associations /

Affinity Groups

Other Lenders/

Existing Clients

RECOGNISE TECHNOLOGY - Enabling cost base to be

controlled

12

SELECTION OF KEY PARTNERS

The Recognise technology environment will be

the next digital banking platform for SMEs

using the best-in class technology to enable

open APIs banking, and ensuring PSD2 and

GDPR regulatory compliance. The platform will

be hosted in the Amazon Web Service cloud,

and orchestrated via Mambu’s managed

service. We will automate some of our

processes, thus allowing us to focus on

serving our customers and delivering a fast

and efficient service, in days not weeks.

A core engine to manage the loan process. Flexible

and supporting all our business scenarios. The

platform has been deployed worldwide, OakNorth

being the most noticeable client in the UK.

CORE BANKING PLATFORM

Manages the deposit taking, maintaining and

closing of savings. Delivers its service to 13

banks, including Aldermore and Paragon. £29bn

and 1m of customer accounts managed under

white label proposition

DEPOSITS

To deliver a complete solution we are

well-advanced in conversations with

suppliers for regulatory reporting,

accounting, payments, KYC/KYB,

and Omnichannel experience.

OTHER PARTNERS

IMPLEMENTATION

16 weeks (currently 4/5 weeks

into implementation

TESTING

8 weeks

IF WE ARE SUCCESSFUL

IN DELIVERING OUR

STRATEGY, WITH IMPACT,

BY 2024…..

£1.1bn Loans

£1.3bn Deposits

44,000

Depositors

4,500

Borrowers

Profits Before Tax > £30m

Provisional Loss Target

80-85 bps

CET1 Ratio 18%

Recognise brand renowned for

business understanding,

responsiveness, expertise,

accessibility, flexibility and

fairness

New products

launched from

lean, versatile

cloud-based

platform

Cost/Income

Ratio

<40%

Business Centres in London,

Midlands, Manchester and Leeds

Over 100

energised

colleagues

13

14

SUMMARY

Why us?

A depth of

challenger and high

street bank

experience

Track record of

building new

SME businesses

Established

networks and

contacts in key

regions

The lessons

learned from

economic cycles

over 3 decades

Built a strong

independent Board

to support an

ambitious

executive team

“Having seen the proposed service proposition, 90% of

market research respondents would expect Recognise

to offer better service than their current bank”

Brandface - April 2018

DISCLAIMER

15

This presentation (the "Presentation"), has been

prepared and issued by the directors of City of London

Group plc (the "Company" and, together with its

subsidiaries, the “Group”). By attending (whether in

person or by telephone) or reading the Presentation,

you agree to be bound by the conditions set out below.

The Presentation does not constitute or form part of,

and should not be construed as investment advice or

any offer or invitation to sell or issue, or any solicitation

of any offer to purchase or subscribe for, any shares or

other securities of the Company, nor shall it (or any

part of it), or the fact of its distribution, form the basis

of, or be relied on in connection with or act as any

inducement to enter into, any contract whatsoever

relating to any securities or financial instruments,

acquisition or investment in the Company, or financial

promotion. No person affiliated with the Company, its

directors, officers, employees, affiliates, agents or

advisers has been authorised to give any information

or to make any representation not contained in the

Presentation and, if given or made, such information or

representation must not be relied upon.

The Presentation is provided solely for general

information only and must not be used or relied upon

for the purpose of making any investment decision or

engaging in any investment activity. The information

and opinions in the Presentation are provided as at the

date of the Presentation (unless stated otherwise) and

are subject to change without notice. The Presentation

does not purport to contain all information that may be

required to evaluate the Company and/or the Group.

While such information is believed to be reliable for the

purposes used in the Presentation, no reliance may be

placed for any purpose whatever on the information or

opinions contained or expressed in the Presentation or

on the accuracy, completeness or fairness of such

information and opinions.

To the extent available, the industry, market and

competitive position data contained in this Presentation

comes from official or third party sources. While the

Company reasonably believes that each of these

publications, studies and surveys has been prepared

by a reputable source, the Company has not

independently verified the data contained therein. In

addition, certain of the industry, market and

competitive position data contained in this Presentation

comes from the Company’s own internal research and

estimates based on the knowledge and experience of

the Company’s management in the markets in which

the Company operates. While the Company believes

that such research and estimates are reasonable and

reliable, they, and their underlying methodology and

assumptions, have not been verified by any

independent source for accuracy or completeness and

are subject to change. Accordingly, undue reliance

should not be placed on any of the industry, market or

competitive position data contained in this

Presentation.

Nothing in the Presentation is, or should be relied on

as, a promise or representation as to the future. The

Presentation includes certain statements, estimates

and projections provided by the Company that are, or

may be deemed to be, “forward-looking statements”.

Forward-looking statements are identified by the use of

such terms as “believe”, “could”, “envisage”, “estimate”,

“potential”, “intend”, “may”, “plan”, “will”, or the negative

of those, variations or comparable expressions,

including references to assumptions. By their nature,

forward- looking statements involve substantial known

and unknown risks, uncertainties, assumptions,

estimates and other factors which may or may not

prove to be correct and because they may relate to

events and depend on circumstances that may or may

not occur in the future and may be beyond the

Company’s ability to control or predict that could cause

the actual results, performance or achievements of the

Company to be materially different from future results,

performance or achievements expressed or implied by

such forward-looking statements. Past performance

should not be taken as an indication or guarantee of

future results and you are cautioned not to place

undue reliance on forward-looking statements. No

statement in the Presentation is intended as a profit

forecast or a profit estimate.

No representations, express or implied, are given in, or

in respect of, the Presentation, including as to the

fairness, accuracy or completeness of the contents of

this Presentation or any other statement made or

purported to be made in connection therewith, or that

any of the forward-looking statements, projections or

forecasts will come to pass or that any forecasted

result will be achieved. To the fullest extent permitted

by law, none of the Company, its subsidiaries or its or

their respective directors, officers, employees, advisors

or agents or any other person shall have any liability

whatsoever for any loss howsoever arising, directly or

indirectly, from the use of the Presentation or its

contents or otherwise arising in connection therewith.

Except to the extent required by applicable law or

regulation, none of the Company, its subsidiaries, or its

or their respective directors, officers, employees,

advisors or agents, or any other person undertakes or

is under any duty to update the Presentation or to

correct any inaccuracies in any such information which

may become apparent or to provide you with any

additional information.

The Presentation is not intended for distribution to, or

use by, any person in any jurisdiction where such

distribution or use would be contrary to local laws or

regulations and therefore persons receiving this

Presentation should inform themselves about and

observe such restrictions.

16

APPENDIX

COLG BOARD MEMBERS

17

COLIN WAGMAN

Non-Executive Chairman

From 1998 until March 2018 he was Deputy

Chairman and Chief Financial Officer of

Delancey which is the principal adviser to

the Delancey property funds which held

several billion pounds of property

investments and developments in the UK.

MICHAEL GOLDSTEIN

CEO

35+ years experience. A Senior Audit

partner in BDO LLP where he was

responsible for the management of the

national audit business. CEO of COLG

since 2017.

PAUL MILNER

Executive Director

Paul qualified as a solicitor in 1986 but has

spent most of his career in the property,

construction and private finance industries.

Since July 2013 he has been Chief Executive

of a privately owned group of property

companies associated with Harvey Bard.ANDY CROSSLEY

Independent Non-Executive Director

Andy spent twenty-four years, principally

at Invesco Perpetual, as one of the UK’s

best known UK small cap fund managers.

Andy currently sits on the AIM Advisory

Group and brings a wealth of corporate

governance and capital markets expertise

to the Group.

LORRAINE YOUNG

Independent Non-Executive

Director

Lorraine is a Past President and Fellow

of ICSA, the Governance Institute. She

has held senior governance roles at a

number of blue chip companies,

including Standard Chartered plc and

Brambles Industries plc.

RECOGNISE INDEPENDENT NON-

EXECUTIVE DIRECTORS

18

PHILIP JENKS

Chair

Previously held roles as Chairman and Non

Executive Director role at Chartercourt FS

Group and Leeds Building Society.

Experienced in the regulatory application

process to obtaining a banking licence for

Charter Savings to launch their savings

proposition.

SIMON WAINWRIGHT

Non Executive Director, Chair

of Risk Committee

Simon Wainwright is MD, UK and

Ireland and COO for Europe, Middle

East and Africa at global reinsurer

Reinsurance Group of America

(RGA).

RICHARD GABBERTAS

Non Executive Director, Chair of Audit

Committee

Led KPMG's Regional Financial Services

Practice providing audit and advisory services

to a range of household names in the sector

from established banks and building societies

to new entrants. He has extensive knowledge

of financial services and a deep understanding

of banking regulation.

LOUISE MCCARTHY

Non Executive Director, Chair of

Remuneration Committee

35 years’ experience in large private and

public sector organisations, embracing

complex technology and digital

transformation strategies. IT

Transformational / Change Director at HM

Revenue & Customs and numerous

contractor roles as transformational director.

MOORAD CHOUDHRY

Non Executive Director

Moorad started his impressive career as an

analyst at The London Stock Exchange and

later moved on to roles at well established

companies including ABN Amro, KPMG, JP

Morgan Chase, Europe Arab Bank and

RBS. He was previously CEO of Habib Bank

UK and, most recently, worked at Cambridge

and Counties.